On Feb. 20, the U.S. Supreme Court ruled that President Donald Trump's IEEPA-based tariff program was illegal, jeopardizing an estimated $133.5 billion to roughly $179 billion in collected duties. Depending on how quickly refunds are processed and whether they are funded from Treasury cash balances or new bill issuance, the resulting liquidity shifts and deficit optics could shape both Bitcoin's liquidity backdrop and its anti-fiat narrative.

Dragonfly Capital closed its fourth $650 million fund in a venture environment described as a “mass extinction event,” signaling that institutional backing for select crypto managers persists. Data from Binance Research, Keyrock, Animoca Brands Research, Memento Research, and Tokenomist show how low-float, high-FDV token launches and large unlock schedules have driven systematic dilution and price pressure. While some projects like Backpack, Jupiter, and USDai experiment with KPI-based unlocks, revenue-linked buybacks, or fully transparent token sales, others face heavy overhang from insider unlocks and thin liquidity. Whether new VC capital flows into token-heavy structures or fintech rails without tokens will shape how much of this funding actually benefits liquid crypto assets.

In early 2026, several high-profile crypto leaders, including Akshay BD from Solana, Anthony Rose from zkSync, and Kyle Samani of Multicoin, announced moves into AI or other domains, raising concerns about a leadership drain. Data from Electric Capital shows overall monthly active crypto developers fell about 7% year over year in 2024, while experienced contributors with at least two years in the space grew 27%. Industry figures argue this reflects cyclical churn and leadership reshuffles rather than a collapse in core builders, as regulatory clarity around stablecoins and convergence with AI create new incentives for hybrid financial infrastructure.

On Feb. 11, Bitcoin contributors merged BIP-0360, introducing the Pay-to-Merkle-Root output to the BIPs repository. The draft neither upgrades nodes nor sets activation, but proposes removing Taproot's key-path to limit long-exposure risk from on-chain public keys. P2MR would raise spend size (minimum 103 bytes vs 66) and reduce privacy, making any future shift strictly opt-in.

Bitcoin jumped from about $60,000 to over $70,000 within a day after a sharp selloff that had erased roughly 14% and liquidated around $1 billion in leveraged positions. The recovery followed a broad macro rebound across equities and precious metals, but derivatives and options positioning still indicate heavy demand for downside protection and sizable put interest around the $60,000–$50,000 area.

On Feb. 5, a wallet labeled as World Liberty Financial on Arkham Intelligence withdrew about 73 WBTC and 100 WBTC from Aave V3 and sold them to repay $11.75 million in stablecoin liabilities. The address, whose ownership is not confirmed, now shows a health factor of 1.54, with roughly 13,298 WETH and 167 WBTC posted against $18.47 million in variable-rate USDC debt.

Bitcoin's drop to $60,233 before a rebound to $65,443 has pushed eight pure-play Bitcoin treasury companies close to $10 billion in combined unrealized losses on more than 850,000 BTC. Strategy, Metaplanet, and Twenty One Capital are among the hardest hit, and scenario analysis shows Strategy's paper losses could total $27.14 billion if Bitcoin falls to $38,000. Market-to-net-asset-value discounts, ETF outflows, and reflexive financing pressures are amplifying the stress across these highly leveraged balance sheets.

Trend Research, led by Jack Yi, built a heavily leveraged Ethereum position on Aave that at its peak involved roughly $958 million in borrowed stablecoins against about 601,000 ETH. As Ethereum's price slid in early February, the fund began selling ETH and repaying debt, including a 10,000 ETH transfer to Binance on Feb. 4 to cut risk. The remaining 488,172 ETH is now valued near $1.05 billion, with on-chain data indicating unrealized losses of around $862 million since the end of January and multiple liquidation thresholds that could impact broader market liquidity.

On Feb. 3, Bitcoin briefly dropped about 8%, undercutting the $73,000 level before rebounding toward $74,500 and trimming the intraday decline to 5.8%. The move coincided with macro risk-off sentiment tied to Kevin Warsh's Fed chair nomination and disappointing Microsoft Azure growth, while more than $2.5 billion in liquidations and thin weekend liquidity amplified the selloff. Bitcoin is now trading around key support between roughly $72,700 and $73,500, with resistance clustered from about $74,500 up to the $80,620 zone.